New Delhi: Indian Olympic Association’s “faulty” sponsorship agreement with Reliance India Limited (RIL) has given undue favour to RIL and led to a loss of ₹24 crore to IOA, according to a CAG audit report.
Under the terms of the sponsorship agreement dated Aug 1, 2022, RIL has been granted the right to associate with IOA as Official Principal Partner of the Asian Games (2022, 2026), Commonwealth Games (2022, 2026), 2024 Paris Olympics and 2028 Los Angeles Olympics. The agreement, besides other things, gave RIL the rights to construct, showcase the ‘India House’ during these Games. The CAG report said through an amended agreement on Dec 5, 2023, additional rights of Winter Olympic Games (2026, 2030) and Youth Olympic Games (2026, 2030) were also granted.
“In view of the above the IOA did not watch their own interest as there was no change in consideration amount i,e ₹35 crore which was set in the Sponsorship Agreement signed on December 5, 2023 after giving the rights of four additional games to RIL,” says the audit report sent of September 12.
“The IOA should have raised the consideration amount from ₹35 crore to ₹59 crore as the consideration amount of rights of six games was ₹35 crore which was calculated on an average of ₹6 crore per games.
“Thus, there was loss of ₹24 crore to IOA due to faulty agreement with RIL and undue favour to RIL,” the report noted. “The reason for not enhancing the amount by ₹59 crores may be intimated to audit.”
IOA president PT Usha has been asked to reply on the half-margin issued by CAG.
Ajay Kumar Narang, executive assistant to IOA president Usha, said the agreement had to be renegotiated because of a ‘flaw’ in the tender.
“When the agreement was signed and naming rights were granted, it was in the name of sponsors — Reliance India House. In 2022, the International Olympic Committee allowed sponsors name with the country house. But in 2023 the IOC changed the conditions to say that the sponsor cannot use a name and it will have to be a country-named House,” said Narang.
“The sponsor came back to us saying they will not get the mileage, so they had to be compensated. So additional rights of four events were given. Also, CAG has calculated pro-rata per event which will be ₹6 crore per Games. It is calculated on the visibility a sponsor gets. In Winter Olympics and Youth Olympics India’s participation is much less compared to Summer Olympics.”
“In the agreement made in 2022 they should have specified that it would be subject to the conditions of naming as approved by the IOC. That was the flaw in the agreement and flaw in the tender itself.”
IOA treasurer Sahdev Yadav, however, said the executive council and the sponsorship committee were not consulted when the agreement was being amended.
“RIL has benefitted and it is not in the knowledge of the executive board or finance committee and sponsorship committee. The president should answer why the agreement was changed and who signed it? It has led to a loss of ₹24 crore to IOA. This should not have happened,” said Yadav, who is also president of the Weightlifting Federation of India.
